##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 For the quarterly period ended March 31, 2008
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the transition period from  to
 Commission File Number 000-51491
 
 Kona Grill, Inc.
 (Exact Name of Registrant as Specified in Its Charter)
 Delaware
    
    20-0216690(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 7150 East Camelback Road, Suite 220
Scottsdale, Arizona 85251
(480) 922-8100  (Address, including zip code, and telephone number, including area code, of principal executive offices)
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
 o þ




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##### 



TABLE OF CONTENTS
 PagePART I. FINANCIAL INFORMATIONItem 1. Unaudited Consolidated Financial StatementsConsolidated Balance Sheets as of March 31, 2008 and December 31, 2007
    
    
    2Consolidated Statements of Operations for the Three Months Ended March 31, 2008 and 2007
    
    
    3Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2008 and 2007
    
    
    4Notes to Unaudited Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    10Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    19Item 4. Controls and Procedures
    
    
    20PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    21Item 1A. Risk Factors
    
    
    21Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    21Item 3. Defaults Upon Senior Securities
    
    
    21Item 4. Submission of Matters to a Vote of Security Holders
    
    
    21Item 5. Other Information
    
    
    22Item 6. Exhibits
    
    
    22Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   1




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Unaudited Consolidated Financial Statements
 KONA GRILL, INC.
 
 CONSOLIDATED BALANCE SHEETS
 (in thousands, except share data)
 March 31,
    
    
    December 31,2008
    
    
    2007(Unaudited)
    
    
    (Note 1)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    3,152
    
    
    $
    4,991Investments
    
    
    7,553
    
    
    
    14,188Receivables
    
    
    1,369
    
    
    
    1,096Other current assets
    
    
    1,237
    
    
    
    1,393Total current assets
    
    
    13,311
    
    
    
    21,668Long-term investments
    
    
    6,247
    
    
    
    Other assets
    
    
    512
    
    
    
    495Property and equipment, net
    
    
    48,490
    
    
    
    47,311Total assets
    
    $
    68,560
    
    
    $
    69,474LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    3,244
    
    
    $
    3,324Accrued expenses
    
    
    4,048
    
    
    
    4,025Current portion of notes payable
    
    
    676
    
    
    
    663Total current liabilities
    
    
    7,968
    
    
    
    8,012Notes payable
    
    
    1,863
    
    
    
    2,037Deferred rent
    
    
    13,168
    
    
    
    12,994Total liabilities
    
    
    22,999
    
    
    
    23,043Commitments and contingencies (Note 8)Stockholders equity:Preferred stock, $0.01 par value,
2,000,000 shares authorized, none
issued at
March 31, 2008 and
December 31, 2007
    
    
    
    
    
    
    Common stock, $0.01 par value,
15,000,000 shares authorized, 6,612,148
and 6,608,078 shares issued and
outstanding at March 31, 2008 and
December 31, 2007, respectively
    
    
    66
    
    
    
    66Additional paid-in capital
    
    
    53,227
    
    
    
    53,071Accumulated deficit
    
    
    (7,379
    )
    
    
    (6,706
    )Accumulated other comprehensive loss
    
    
    (353
    )
    
    
    Total stockholders equity
    
    
    45,561
    
    
    
    46,431Total liabilities and stockholders equity
    
    $
    68,560
    
    
    $
    69,474
   2




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##### Table of Contents



KONA GRILL, INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (in thousands, except per share data)
 Three Months Ended March 31,2008
    
    
    2007(Unaudited)Restaurant sales
    
    $
    18,796
    
    
    $
    15,666Costs and expenses:Cost of sales
    
    
    5,407
    
    
    
    4,546Labor
    
    
    6,459
    
    
    
    5,075Occupancy
    
    
    1,308
    
    
    
    1,058Restaurant operating expenses
    
    
    2,727
    
    
    
    2,134General and administrative
    
    
    1,852
    
    
    
    1,769Preopening expense
    
    
    178
    
    
    
    488Depreciation and amortization
    
    
    1,658
    
    
    
    1,289Total costs and expenses
    
    
    19,589
    
    
    
    16,359Loss from operations
    
    
    (793
    )
    
    
    (693
    )Nonoperating income (expense):Interest income
    
    
    204
    
    
    
    160Interest expense
    
    
    (34
    )
    
    
    Loss before provision for income taxes
    
    
    (623
    )
    
    
    (533
    )Provision for income taxes
    
    
    50
    
    
    
    10Net loss
    
    $
    (673
    )
    
    $
    (543
    )Net loss per share:Basic
    
    $
    (0.10
    )
    
    $
    (0.09
    )Diluted
    
    $
    (0.10
    )
    
    $
    (0.09
    )Weighted average shares used in computation:Basic
    
    
    6,609
    
    
    
    5,854Diluted
    
    
    6,609
    
    
    
    5,854
   3




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##### Table of Contents



KONA GRILL, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (in thousands)
 Three Months Ended March 31,2008
    
    
    2007(Unaudited)Operating activitiesNet loss
    
    $
    (673
    )
    
    $
    (543
    )Adjustments to reconcile net loss to net cash provided by operating activities:Depreciation and amortization
    
    
    1,658
    
    
    
    1,289Stock-based compensation expense
    
    
    128
    
    
    
    202Change in operating assets and liabilities:Receivables
    
    
    (273
    )
    
    
    65Other current assets
    
    
    156
    
    
    
    (411
    )Accounts payable
    
    
    525
    
    
    
    (236
    )Accrued expenses
    
    
    23
    
    
    
    (399
    )Deferred rent
    
    
    174
    
    
    
    309Net cash provided by operating activities
    
    
    1,718
    
    
    
    276Investing activitiesPurchase of property and equipment
    
    
    (3,442
    )
    
    
    (4,796
    )Increase in other assets
    
    
    (17
    )
    
    
    (50
    )Net proceeds on purchase and sale of investments
    
    
    35
    
    
    
    3,774Net cash used in investing activities
    
    
    (3,424
    )
    
    
    (1,072
    )Financing activitiesRepayments of notes payable
    
    
    (161
    )
    
    
    (149
    )Proceeds from issuance of common stock under the Employee Stock Purchase Plan and exercise
of stock options
    
    
    28
    
    
    
    79Net cash used in financing activities
    
    
    (133
    )
    
    
    (70
    )Net decrease in cash and cash equivalents
    
    
    (1,839
    )
    
    
    (866
    )Cash and cash equivalents at the beginning of the period
    
    
    4,991
    
    
    
    1,934Cash and cash equivalents at the end of the period
    
    $
    3,152
    
    
    $
    1,068Supplemental disclosure of cash flow informationCash paid for interest, net of capitalization
    
    $
    34
    
    
    $
    Noncash investing activitiesDecrease in accounts payable related to property and equipment additions
    
    $
    (605
    )
    
    $
    (1,252
    )
   4




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KONA GRILL, INC.
 
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 1. Basis of Presentation and Significant Accounting Policies
    Cash and Cash Equivalents
  Recent Accounting Pronouncements
 Fair Value
Measurements, Effective Date of FASB Statement No. 157,
 Level 1:
    
    Fair values determined by quoted prices in active markets for identical assets or
liabilities that the Company has the ability to access.
 Level 2:
    
    Fair values utilize inputs other than quoted prices that are observable for the asset or
liability, and may include quoted prices for similar assets and liabilities in active markets,
and inputs other than quoted prices that are observable for the asset or liability.
 Level 3:
    
    Unobservable inputs that are not corroborated by market data and may reflect the
reporting entitys own assumptions market participants would use in pricing the asset or
liability.
  5




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KONA GRILL, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  Fair Value Measurements at Reporting Date UsingQuoted Pricesin Active
    
    
    SignificantMarkets for
    
    
    Other
    
    
    SignificantIdentical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    Inputs
    
    
    March 31,Description
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    2008Short-term investments
    
    $
    7,553
    
    
    $
    
    
    
    $
    
    
    
    $
    7,553Long-term investments
    
    
    
    
    
    
    
    
    
    
    6,247
    
    
    
    6,247$
    7,553
    
    
    $
    
    
    
    $
    6,247
    
    
    $
    13,800
  Fair Value Measurements ofAssets Using Level 3 InputsLong-term InvestmentsBalance at December 31, 2007
    
    $
    Transfer to Level 3
    
    
    8,650Total gains or losses (realized and unrealized)Included in earnings
    
    
    Included in other comprehensive loss
    
    
    (353
    )Net settlements
    
    
    (2,050
    )Balance at March 31, 2008
    
    $
    6,247
 2. Investments
  GrossAdjusted
    
    
    Unrealized
    
    
    EstimatedCost
    
    
    Losses
    
    
    Fair ValueMarch 31, 2008Short-term investments:Corporate debt securities
    
    $
    7,553
    
    
    $
    
    
    
    $
    7,553Long-term investments:Auction rate securities
    
    
    6,600
    
    
    
    (353
    )
    
    
    6,247Total investments
    
    $
    14,153
    
    
    $
    (353
    )
    
    $
    13,800December 31, 2007Short-term investments:Auction rate securities
    
    $
    8,650
    
    
    $
    
    
    
    $
    8,650Corporate debt securities
    
    
    5,538
    
    
    
    
    
    
    
    5,538Total investments
    
    $
    14,188
    
    
    $
    
    
    
    $
    14,188
   6




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KONA GRILL, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
   The
Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments,
 3. Net Loss Per Share
  Three Months Ended March 31,2008
    
    
    2007(In thousands, except per share data)Numerator:Net loss
    
    $
    (673
    )
    
    $
    (543
    )Denominator:Weighted average shares  Basic
    
    
    6,609
    
    
    
    5,854Effect of dilutive stock options and warrants
    
    
    
    
    
    
    Weighted average shares  Diluted
    
    
    6,609
    
    
    
    5,854Net loss per share:Basic
    
    $
    (0.10
    )
    
    $
    (0.09
    )Diluted
    
    $
    (0.10
    )
    
    $
    (0.09
    )
  7




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##### Table of Contents



KONA GRILL, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  4. Accrued Expenses
  March 31,
    
    
    December 31,2008
    
    
    2007Accrued payroll
    
    $
    1,459
    
    
    $
    1,358Business and income taxes
    
    
    604
    
    
    
    629Sales taxes
    
    
    577
    
    
    
    517Gift cards
    
    
    423
    
    
    
    533Accrued occupancy
    
    
    159
    
    
    
    227Other
    
    
    826
    
    
    
    761$
    4,048
    
    
    $
    4,025
 5. Stock-Based Compensation
   Three Months Ended March 31,2008
    
    
    2007Expected volatility
    
    
    35.7
    %
    
    
    34.4
    %Risk-free interest rate
    
    
    2.5
    %
    
    
    4.9
    %Expected option life (in years)
    
    
    3.7
    
    
    
    3.8Dividend yield
    
    
    0.0
    %
    
    
    0.0
    %Weighted average fair value per option granted
    
    $
    3.53
    
    
    $
    6.45
  Shares
    
    
    Weighted
    
    
    Weighted AverageUnder
    
    
    Average
    
    
    Remaining
    
    
    AggregateOption
    
    
    Exercise Price
    
    
    Contractual Term
    
    
    Intrinsic ValueOutstanding options at December 31, 2007
    
    
    655,439
    
    
    $
    12.59Granted
    
    
    170,417
    
    
    
    11.66Forfeited
    
    
    (300
    )
    
    
    7.50Exercised
    
    
    (2,000
    )
    
    
    6.00Outstanding options at March 31, 2008
    
    
    823,556
    
    
    $
    12.41
    
    
    4.3 years
    
    
    $
    621,000Exercisable at March 31, 2008
    
    
    474,389
    
    
    $
    10.77
    
    
    4.3 years
    
    
    $
    616,000
  8




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##### Table of Contents



KONA GRILL, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  6. Comprehensive Loss
  Three Months Ended March 31,2008
    
    
    2007Net loss
    
    $
    (673
    )
    
    $
    (543
    )Net unrealized losses on available-for-sale securities
    
    
    (353
    )
    
    
    Total comprehensive loss
    
    $
    (1,026
    )
    
    $
    (543
    )
 7. Income Taxes
 Accounting for Uncertainty in Income Taxes
 8. Commitments and Contingencies
  9. Subsequent Event
   9




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Overview
     10




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Key Measures We Use to Evaluate Our Company
  Number of Restaurant Openings.
 Same-Store Sales Growth.
 Average Weekly Sales.
 Average Unit Volume.
 Sales Per Square Foot.
 Restaurant Operating Profit.
 Key Financial Definitions
 Restaurant Sales.
 Cost of Sales.
 Labor.
 Occupancy.
 Restaurant Operating Expenses.
 General and Administrative.
  11




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##### Table of Contents



Preopening Expense.
 Depreciation and Amortization
 Interest Income.
 Interest Expense.
 Financial Performance Overview
  Three Months Ended March 31,2008
    
    
    2007Restaurant sales growth
    
    
    20.0
    %
    
    
    53.7
    %Same-store sales growth (1)
    
    
    (2.4
    )%
    
    
    1.4
    %Average weekly sales  comparable restaurant base (2)
    
    $
    83,019
    
    
    $
    85,042Average weekly sales  non-comparable restaurant base (3)
    
    $
    76,283
    
    
    $
    73,046Average unit volume (in thousands)(4)
    
    $
    1,033
    
    
    $
    1,162Sales per square foot (4)
    
    $
    147
    
    
    $
    165Restaurant operating profit (in thousands) (5)
    
    $
    2,895
    
    
    $
    2,853Restaurant operating profit as a percentage of sales (5)
    
    
    15.4
    %
    
    
    18.2
    %
 (1)
    
    Same-store sales growth reflects the periodic change in restaurant sales for the
comparable restaurant base. In calculating same-store sales growth, we include a
restaurant in the comparable restaurant base after it has been in operation for more
than 18 months.(2)
    
    Includes only those restaurants in the comparable restaurant base.(3)
    
    Includes only those restaurants that are not in the comparable restaurant base
that were open for the entire period.(4)
    
    Includes only those restaurants open for at least 12 months before the beginning
of the period measured.(5)
    
    Restaurant operating profit is not a financial measurement determined in
accordance with generally accepted accounting principles and should not be considered in
isolation or as an alternative to income (loss) from operations. Restaurant operating
profit may not be comparable to the same or similarly titled measures computed by other
companies. The table below sets forth our calculation of restaurant operating profit and
reconciliation to income (loss) from operations, the most comparable GAAP measure.  12




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Three Months Ended March 31,2008
    
    
    2007Restaurant sales
    
    $
    18,796
    
    
    $
    15,666Costs and expenses:Cost of sales
    
    
    5,407
    
    
    
    4,546Labor
    
    
    6,459
    
    
    
    5,075Occupancy
    
    
    1,308
    
    
    
    1,058Restaurant operating expenses
    
    
    2,727
    
    
    
    2,134Restaurant operating profit
    
    
    2,895
    
    
    
    2,853Deduct  other costs and expensesGeneral and administrative
    
    
    1,852
    
    
    
    1,769Preopening expense
    
    
    178
    
    
    
    488Depreciation and amortization
    
    
    1,658
    
    
    
    1,289Loss from operations
    
    $
    (793
    )
    
    $
    (693
    )
 Percentage ofRestaurant SalesThree Months Ended March 31,2008
    
    
    2007Restaurant sales
    
    
    100.0
    %
    
    
    100.0
    %Costs and expenses:Cost of sales
    
    
    28.8
    
    
    
    29.0Labor
    
    
    34.4
    
    
    
    32.4Occupancy
    
    
    7.0
    
    
    
    6.8Restaurant operating expenses
    
    
    14.5
    
    
    
    13.6Restaurant operating profit
    
    
    15.4
    
    
    
    18.2Deduct  other costs and expensesGeneral and administrative
    
    
    9.9
    
    
    
    11.3Preopening expense
    
    
    0.9
    
    
    
    3.1Depreciation and amortization
    
    
    8.8
    
    
    
    8.2Loss from operations
    
    
    (4.2
    )%
    
    
    (4.4
    )%
  Three Months Ended
    
    
    Year EndedMarch 31, 2008
    
    
    December 31, 2007Store Growth ActivityBeginning
Restaurants
    
    
    18
    
    
    
    14Openings
    
    
    
    
    
    
    4Closings
    
    
    
    
    
    
    Total
    
    
    18
    
    
    
    18
  13




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Results of Operations
  Three Months EndedMarch 31,2008
    
    
    2007Restaurant sales
    
    
    100.0
    %
    
    
    100.0
    %Costs and expenses:Cost of sales
    
    
    28.8
    
    
    
    29.0Labor
    
    
    34.4
    
    
    
    32.4Occupancy
    
    
    7.0
    
    
    
    6.8Restaurant operating expenses
    
    
    14.5
    
    
    
    13.6General and administrative
    
    
    9.9
    
    
    
    11.3Preopening expense
    
    
    0.9
    
    
    
    3.1Depreciation and amortization
    
    
    8.8
    
    
    
    8.2Total costs and expenses
    
    
    104.2
    
    
    
    104.4Loss from operations
    
    
    (4.2
    )
    
    
    (4.4
    )Nonoperating income (expense):Interest income
    
    
    1.1
    
    
    
    1.0Interest expense
    
    
    (0.2
    )
    
    
    Loss before provision for income taxes
    
    
    (3.3
    )
    
    
    (3.4
    )Provision for income taxes
    
    
    0.3
    
    
    
    0.1Net loss
    
    
    (3.6
    )%
    
    
    (3.5
    )%
  Three Months Ended March 31, 2008 Compared with Three Months Ended March 31, 2007
 Restaurant Sales.
 Cost of Sales
  14




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Labor
 Occupancy
 Restaurant Operating Expenses
 General and Administrative
 Preopening Expense
 Depreciation and Amortization
 Interest Income.
 Interest Expense.
 Provision for Income Taxes
  15




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Potential Fluctuations in Quarterly Results and Seasonality
  
    
    timing of new restaurant openings and related expenses;
    
    restaurant operating costs and preopening costs for our newly-opened restaurants, which
are often materially greater during the first several months of operation than thereafter;
    
    labor availability and costs for hourly and management personnel;
    
    profitability of our restaurants, especially in new markets;
    
    increases and decreases in comparable restaurant sales;
    
    impairment of long-lived assets and any loss on restaurant closures;
    
    changes in borrowings and interest rates;
    
    general economic conditions;
    
    weather conditions or natural disasters;
    
    timing of certain holidays;
    
    new or revised regulatory requirements and accounting pronouncements;
    
    changes in consumer preferences and competitive conditions; and
    
    fluctuations in commodity prices.
   16




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Liquidity and Capital Resources
       17




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Equipment Loans
  Cash Flows
  Three Months Ended March 31,2008
    
    
    2007Net cash provided by (used in):Operating activities
    
    $
    1,718
    
    
    $
    276Investing activities
    
    
    (3,424
    )
    
    
    (1,072
    )Financing activities
    
    
    (133
    )
    
    
    (70
    )Net decrease in cash and cash equivalents
    
    $
    (1,839
    )
    
    $
    (866
    )
 Operating Activities.
 Investing activities.
 Financing Activities.
 Critical Accounting Policies
   18




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Investments
 Accounting for Certain Investments in Debt and Equity
Securities
  
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
  Investments
  Primary Market Risk Exposures
   19




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Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control over Financial Reporting
   20




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PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  We may be required to record impairment charges in future quarters as a result of the decline in
value of our investments in auction rate securities.
    
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
   21




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Item 5. Other Information
  
 Item 6. Exhibits
  3.1
    
    Amended and Restated Certificate of Incorporation of the Registrant (1)3.3
    
    Amended and Restated Bylaws of Kona Grill, Inc. (2)4.1
    
    Form of Common Stock Certificate (3)4.2
    
    Kona Grill, Inc. Stockholders Agreement, dated August 29, 2003 (3)4.3
    
    Kona Grill, Inc. Series A Investor Rights Agreement, dated August 29, 2003 (3)4.4
    
    Amendment No. 1 to Kona Grill, Inc. Series A Investor Rights Agreement, dated
May 31, 2005 (3)31.1
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule
15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.31.2
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule
15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.32.1
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
 
 (1)
    
    Incorporated by reference to Amendment No. 1 to the Registrants Registration
Statement on Form S-1 (Registration No. 333-125506), as filed on July 8, 2005.(2)
    
    Incorporated by reference to the Registrants Form 8-K filed on November 5,
2007.(3)
    
    Incorporated by reference to Amendment No. 2 to the Registrants Registration
Statement on Form S-1 (Registration No. 333-125506), as filed on July 21, 2005.  22




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##### Table of Contents



SIGNATURES
  Kona Grill, Inc./s/ Marcus E. JundtMarcus E. JundtChairman of the Board, President, and
Chief Executive Officer/s/ Mark S. RobinowMark S. RobinowExecutive Vice President, Chief
Financial Officer, and Secretary
(Principal Accounting and Financial
Officer)   23




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNo.
    
    Description31.1
    
    Certification of Chief Executive Officer pursuant to Rule
13a-14(a) and Rule 15d-14(a), promulgated under the Securities
Exchange Act of 1934, as amended.31.2
    
    Certification of Chief Financial Officer pursuant to Rule
13a-14(a) and Rule 15d-14(a), promulgated under the Securities
Exchange Act of 1934, as amended.32.1
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
  24